Need to address challenges in farm sector to double income

New Delhi: At a time when the country is going through a "very" tough time on the economic front, the government is pinning hope on agriculture for the needed "recovery" of financial health of the country.

The government, in its Economic Survey 2019-20, has suggested giving increased focus on exploring global markets for agricultural commodities to give an additional source of market for the surplus of agricultural produce of India.

To achieve the target of doubling farmers' income by 2022, the Economic Survey said that there is an urgent need to address some of the basic challenges like credit, insurance coverage and irrigation facilities in the agriculture and its allied sectors.

The survey report, which was tabled in Parliament on Friday by Finance Minister Nirmala Sitharaman, also stressed on looking forward to commercial farming where farm mechanisation can play a bigger role.

Taking a leaf out of China and Brazil's success stories, the survey pointed out that China and Brazil have achieved farm mechanisation of 60 per cent and 75 per cent respectively and in Indian agriculture only 40 per cent of farm machinery is being used. While 82 per cent of farmers in India are small and marginal with a landholding of 2.5 acres or less, the focus in the Survey on mechanisation is over-emphasised.

In states like Bihar, parts of Uttar Pradesh, Chhattisgarh, Madhya Pradesh and even the Vidarbha region in Maharashtra that have a concentration of small and marginal farmers, farming is done in the traditional method. Moreover, it is a known fact that precision and such mechanised farming require huge tracts of land.

Land reforms have been pending for a long time and the Survey talks about facilitating farm mechanisation than being inclusive for share croppers and others depending on land which is getting fragmented by the year.

The Economic Survey, which is prepared by Chief Economic Advisor Krishnamurthy Subramanian, also gives a review of the developments in the economy over the previous 12 months and also gives an outlook for the next financial year.

Allied agricultural sector, such as livestock and fisheries, which is an important secondary source of income and is vital for augmenting farmers' income, the survey said.

The survey has introduced a new element of "thali — a plate of food", claiming that since 2015 the average affordability of vegetarian thalis improved 29 per cent from 2006-07 to 2019-20 while that for non-vegetarian thalis by 18 per cent, depending upon the region to which one belongs.

"Although the contribution of agriculture in the national income has declined to 16.5 per cent in 2019-20 from 18.2 per cent in 2014-15, its contribution is central to rural livelihood, employment and national food security. More than 50 per cent of rural households depend on agriculture for their livelihood, with 82 per cent of farmers being small and marginal," the Survey stated.

While the livestock sector registered a compound annual growth rate (CAGR) of 7.9 per cent in the last five years, the fisheries sector, which provides livelihood to 16 million Indians, grew at a CAGR of 7 per cent in recent years.

The Survey reiterated need for increasing gross cropped area covered under Pradhan Mantri Fasal Bima Yojana to 50 per cent from the existing 23 per cent. It also noted that the share of agriculture and allied sectors in GVA of India at current prices has declined from 18.2 per cent in 2014-15 to 16.5 per cent in 2019-2020.

Commenting on the findings of the Survey, former agriculture secretary Siraj Hussain said, "The Survey recommends that under NFSA, only 20 per cent of population should get wheat and rice at Rs 2 and Rs 3 per kg respectively."

"Noted economist Dr Surjit Bhalla estimates that absolute poverty was just 3-5 per cent in 2017-18. It seems that the government is in agreement with these estimates of poverty. The prescription of the Survey to reduce coverage under NFSA in the midst of job losses and serious economic slowdown is jarring, to say the least," Hussain added.